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Growth Forever

By

Rudi Dornbusch

Updated July 30, 1998 12:01 a.m. ET

A stumbling stock market, a poor second quarter and the prospect of negative numbers for the third quarter raise the question of whether the "new economy" has suddenly become old. Though it is not yet clear just how the long expansion might end, there are three likely possibilities. First, it might run out of steam as demand fizzles. Second, the Asian depression might overwhelm earnings prospects, stock market values and hence household confidence. Finally, Federal Reserve Chairman Alan Greenspan might, in time-honored...